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Less than maximum SEPP interest rate

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ByScott Bar

L1: Less than maximum SEPP interest rateThe current SEPP interest rate is 1.57 listed on this site, assuming I take the first distribution this month.

Since this is the calculated maximum amount that cannot be exceeded, does it make sense to use a slightly lower rate, say 1.55, just in case the IRS calculation comes out lower than 1.57?
Denver
2012-06-15 02:38, By: Scott Bar, IP: [204.96.170.173]

L2: Less than maximum SEPP interest rateThe 1.57% rate listed on this site is the correct (gov’t approved) max SEPP rate for May 2012,and will not change, so no need to lower it. That May rate can be used for June or July 2012 plan start months, so if first payment is made in either month, it would be valid rate to use. If you wanted to use a lower value than the stated Max in your calculations, it is OK, but not necessary.2012-06-15 03:23, By: Ken, IP: [72.74.61.202]

L3: Less than maximum SEPP interest rateThank you …2012-06-15 03:32, By: Scott Bar, IP: [204.96.170.173]

L4: Less than maximum SEPP interest rateIn addition to the responses that you can use less than the maximum rate, and that the IRS will not challenge the rate on this site, let me add the following :
1. If you need less than the annual amount calculated using the maximum interest rate, then use the reverse calculator to determine the minimum amount needed in the SEPP 72-T account, and transfer the un-needed excess to a separate account for future emergency purposes.
2. Also, if in future years you need less, you can make a one time change in method, as described on this website.
If you are only being conservative in case IRS might remotely audit your SEPP plan, you can’t even send IRS extra tax payments because they will only refund it to you.2012-06-15 18:52, By: dlzallestaxes, IP: [71.175.95.64]

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